Daily Gold Update

Source:Bill Musgrave, American Gold Exchange

AustinNew York spot gold rebounded 1.2% to close above $2,698 on mixed data as Treasury yields and the dollar receded ahead of the Fed's decision on interest rates. Silver rose 1.7% to finish at $31.77 an ounce.

Initial jobless claims rose 3,000 to 221,000 last week after three straight weeks of declines, and wholesale inventories declined in September for the first time in six months, a sign that businesses are cautious about the direction of the economy.

On the positive side, US productivity rose 2.2% in the third quarter, generating both higher profits for businesses and higher pay for employees.

Benchmark 10-year Treasury yields pulled back under 4.4% as traders prepared for a rate cut from the Fed at the conclusion of its two-day meeting. Lower yields lift gold by decreasing the opportunity cost for holding it instead of bonds for safety.

Tracking with yields, the dollar dropped 0.7% against major rivals as traders took profits from yesterday's surge to a four-month high. A falling dollar supports gold and other commodities by making them cheaper overseas.

As expected, the Fed cut interest rates by a quarter-point, with similar a reduction on the table for December. But President-elect Donald Trump's policies on tariffs and taxes are expected to complicate further rate-cuts by supporting higher prices.

Platinum picked up 0.7% while palladium retreated 1.8%.

At the New York spot close: gold gained $30.80 to $2,698.40; silver rose 54 cents to $31.77; platinum added $6.80, to $992.80; and palladium slipped $19.10 to $1,020.70 an ounce.